U.S. Treasury Secretary Steven Mnuchin on Monday said companies from China and other countries that fail to comply with U.S. accounting standards will be delisted from American stock exchanges by the end of 2021.

Mnuchin and other officials recommended the move to the U.S. Securities and Exchange Commission (SEC) last week. They said the aim is to ensure Chinese firms are held to the same standards as U.S. companies.

China's Foreign Ministry then said it firmly opposed any U.S. actions against Chinese companies after U.S. Secretary of State Mike Pompeo reportedly said that the Trump administration planned to take action on some Chinese software companies.

A total of 245 Chinese companies have been listed in the U.S. with a market capitalization of 1.88 trillion dollars as of July 28. Out of the 245 firms, 107 have a market cap below 1 billion yuan, while 23 have a market cap exceeding 100 billion yuan. The 23 firms' total market cap account for over 87 percent of the total market cap for U.S.-listed Chinese companies.

Among those that could be affected are the top five U.S.-listed Chinese stocks in terms of market cap. That's Alibaba, China mobile, Pinduoduo, JD.com, and China Life Insurance. 

Out of the total 245 Chinese firms listed in the United States, 165 are on the Nasdaq, 75 are on the New York stock exchange, while five of the Chinese firms listed on the NYSE American.

Essentially, the Trump administration wants these companies to prove that they are not under the control of a foreign government. That's somewhat vague as people can think of at least one company, Boeing in the United States, that has in the past received some forms of state support from the Trump administration.